When a company is preparing a budgeted statement of cash flows and they wish to calculate the payments for operating expenses, they should refer to which of the following?

Question

Quizplus · Accepted Answer

The budgeted cash payments for operating expenses is the section of the budgeted statement of cash flows that outlines the expected cash outflows for things like salaries, rent, utilities, and other day-to-day business expenses. This is the most relevant information to use when calculating payments for operating expenses. The budgeted cash payments for purchases refers to the expected cash outflows for inventory or materials and is not relevant to operating expenses. The sales budget and budgeted balance sheet also do not provide specific information about operating expenses.

When a Company Is Preparing a Budgeted Statement of Cash